Dan Passarelli, CEO - Market Taker Mentoring

The market was a little red today. We closed a little bit lower, about a percent or so in the S&P 500. But there were a couple of sectors that have led the market lower and there are some sectors that I might want to avoid for the short term or at least putting on any new bullish positions in the short term. So we're going to start by looking at the communications sector and if you look ATT yesterday had earnings, the stock was down quite a bit, fell from about 20 and a half down to about 19 as far as the closed before earnings and the open after earnings.

If we come and we look here and pull up the earnings data, the earnings were $0.60 estimated and they actually ended up being $0.65. And that's why I tell people earnings is so difficult to predict direction wise and should stick to volatility trading around earnings and stay away from trying to predict direction. Needless to say, after that big gap lower, ATT continued lower today and Verizon symbol VZ, kind of a similar thing. It gapped lower yesterday in sympathy with ATT. And then this is definitely a case of sell the rumor and also sell the news because the stock gapped lower when earnings came out today.

So that's the communications sector; a little bit of a bloodbath there. And then the technology sector was not really great either. And one of the big ones there was Snapchat. SNAP fell from, let's see, it closed before earnings at $16.35 and opened at $11.10, just a massive 39% lower is where it closed.

And then of course we see Amazon and Apple and a lot of the tech sector falling in sympathy with that. So those are the sectors that really perform the worst today and ones that I might stay away from. Or if I see some stocks that I like in the long term, maybe consider some cash secured puts because we often have higher volatility when stocks go down. I hope that helps going into the weekend. Have a great weekend.